We hypothesize that matrix metalloproteinases (MMPs) modulate the anti-angiogenic activity of pigment-epithelium derived factor (PEDF), and that this proteolytic activity contributes to a loss of balance between anti-angiogenic and pro-angiogenic factors in the eye leading to ocular neovascularization. The level of PEDF protein is decreased in eyes afflicted with pathological angiogenic conditions while MMP activity is found to be upregulated in these diseased tissues. We have found that PEDF is a substrate for the pro-angiogenic matrix-metalloproteinases-2, and -9. We also found that the proteinase MMP-9 cleaves PEDF within the anti-angiogenic region near the N-terminus and within the serpin reactive center loop near the C-terminus. Cleavage of PEDF by MMP-9 eliminates the anti-angiogenic activity of PEDF as measured in the mouse aortic ring assay, and converts PEDF into an endothelial chemoattractant factor. Finally, pretreatment of mouse eyes with intravitreal injection of an MMP-2 and -9 inhibitor tripled the observed amount of PEDF in mouse eyes intravitreally transduced with an adenovector designed to express PEDF. We propose herein 1) to determine the specific sequences within PEDF targeted by MMP-2 and -9;2) determine the activities of the isolated fragments of MMP-treated PEDF, and 3) test the hypothesis that MMPs modulate PEDF activity in vivo by evaluating MMP-resistant mutant PEDF in a mouse model of choroidal neovascularization. Diseases of ocular neovascularization, the most prevalent being diabetic retinopathy and exudative age-related macular degeneration, are the leading cause of blindness in developed countries. These diseases threaten the sight of a quickly growing population-at-risk, and although there are limited therapeutic interventions at hand, there is, as yet, no cure. This research will advance the basic knowledge of the mechanism of pathological ocular angiogenesis, and will likely lead to advances in treatment of such diseases. Diseases of ocular neovascularization are the leading cause of blindness in developed countries and there are limited therapeutic interventions. We hypothesize that matrix metalloproteinases modulate the anti-angiogenic activity of pigment-epithelium derived factor, and that this proteolytic activity contributes to a loss of balance between anti-angiogenic and pro-angiogenic factors in the eye leading to ocular neovascularization. Our research will advance the basic knowledge of the mechanism of pathological ocular angiogenesis, and will likely lead to advances in treatment of such diseases.